ONGC seeks govt nod to bid for Lanka gas blocks

Given the ongoing tensions with Sri Lanka and in the wake of the recent decision of Indian Prime Minister to cancel his trip to the neighbouring nation, state-owned Oil and Natural Gas Corp (ONGC) has sought political clearance from the ministry of external affairs (MEA) to participate in Sri Lanka’s offshore bidding rounds that are open till November 29.

The offshore area of Sri Lanka’s Cauvery and Mannar basins holds tremendous potential and has attracted several upstream companies due to gas discoveries in Mannar Basin. These blocks also hold immense strategic importance as they are located close to Indian shores.

“India’s presence in Sri Lanka’s oil and gas sector assumes great strategic importance for us ...however, given the ongoing situation with Sri Lanka, we need to seek political clearance before ONGC goes ahead and submits its bid ...the decision rests with the MEA,” said a senior petroleum ministry official.

Government sources also said that MEA was unlikely to hold back ONGC to bid for oil and gas blocks in Sri Lanka as New Delhi over the past few years has making all efforts to get a toehold in most oil and gas exploration blocks on borders with neighbours such as Sri Lanka and Myanmar.

“Due to the strategic importance of these blocks, officials from both the petroleum and foreign ministries have been holding parleys with top officials of these countries to get allotment of these blocks on nomination basis,” the official added.

Sri Lanka had launched the second offshore petroleum bidding round on March 7 and around 19 blocks have been offered. ONGC’s global arm — ONGC Videsh Ltd (OVL) has already qualified for participation in the bidding process.

“OVL is keen to participate in the Sri Lanka Bid Round 2013 and after studying the data, may consider submission of bids for technically and commercially viable exploration blocks on or before November 29 ...it is requested that the political clearance for OVL’s entry into Sri Lanka may please be obtained from MEA,” OVL wrote to the petroleum ministry.

Prime Minister Manmohan Singh had recently conveyed his decision to Sri Lankan President Mahinda Rajapaksa over skipping the Commonwealth Heads of Government Meeting (CHOGM) keeping in mind public sentiments in Tamil Nadu.

However, foreign minister Salman Khurshid attended the Commonwealth summit on Friday despite demands from political parties in Tamil Nadu for a total boycott.